Due to the veritable avalanche of Australian media reports on the future Australian Submarine (Project SEA 1000) debate I shall no longer post the text of Australian articles by other writers (unless I've written the articles myself). The volume of those reports will continue until an actual selection is made in the next 3 years or so.The best ongoing news source on this debate is the moving news feed on the Australian Submarine Institute website at http://www.submarineinstitute.com/ under "OTHER NEWS" on the right hand panel. Also see its RSS at http://www.submarineinstitute.com/RSS-News-Feed-Submarine-Institute-of-Australia.rss . For April 9-10, 2014 you will see how many articles there are.What I shall continue to do is report on: other submarine characteristics and forces (of non-"Five Eyes") in Australia's region; the Swedish-German corporate battle; and on major powers as far away as Russia. Reporting on foreign reconnaissance satellites will continue.Occasional reporting on (regional relations, broadly defence of Australia, surface warships, aircraft, missiles, terrorism and non-Five Eye sigint) will also continue :)Pete

6 comments:

Anonymous
said...

From ASPI's blog:"Everyone seemed to miss it—a statement in public (at ASPI’s Submarine Choice conference) from the chairman of the Western world’s largest and most successful builder of conventional submarines: a fleet of 12 large state-of-the-art boats would cost around $20 billion. That’s $16 billion less than ASPI’s own estimate and was given by Dr Hans Christoph Atzpodien, the head of ThyssenKrupp Marine Systems. Since his company has built over 180 submarines since 1960, he should know about submarine costs."

And something about British experts:"A conspiracy theorist might think this is all a huge collective effort to make Australians feel that submarines are so costly and so difficult to buy that we need to procrastinate for even longer before making hard decisions. That was certainly the distilled essence of the British speakers at the conference, who were the lead of the Integrated Project Team and the design managers for the program and revealed, to the quiet amusement of some in the audience, that after a couple of years of study—and undoubtedly millions of dollars in fees—they haven’t even reached the ‘pre-concept’ phase of their work."

Regarding the concern in http://www.aspistrategist.org.au/aspis-submarine-conference-key-messages/ about the alleged disparity in costings:

It appears Dr Hans Christoph Atzpodien's estimate of $20 billion for twelve future submarines is only up-front production costs, which is just a subset of ASPI's $36 billion whole of program costs,:

I had a look at ASPI's original figures which were in this 2009 paper https://www.aspi.org.au/publications/strategic-insights-48-how-to-buy-a-submarine-defining-and-building-australias-future-fleet/SI_48_Submarines.PDF

Program Costs (see page 9) did add up to $36 billion or more - in 2009 dollars. This would now be around $40 billion in 2014 dollars.

It is up-front production costs (page 8) - a portion of Program Costs - that were estimated in 2009 to be $16.8 billion which equates with around $20 billion in 2014 dollars.

It appears that TKMS will need to itemise what they are including in their lower figures in future.

the article mentions $16.8 billions for 12 submarines of Collins-class size (3,000 t) at the costs of a Collins-class submarine.

Then they calculated the price for a (4,000 t) submarines to be one third higher. That would be $22.8 billion. After that the authors add also 3.8% annual growth over a decade of 20 years (1.038^20 = 2.1) $46 billion. Is $36 billion just a typo or miscalculation by using the $16.8 billion for Collins-Class?

On page 10 you can find the price for 12 Type 212/214 submarines for 2020: $8.8 billion (base price $550 million).At 2,000 for a Type 214 you just double the price according to the article to get the price for a 4,000 t submarine: $17,6 billion.

I think the figures in 2009 were rough and speculative. Given all the current uncertainties 2009 calculations have declining value now.

It is up to TKMS to explain in detail how, in the last week, they arrived at such surprisingly low figures.

As I indicated above TKMS will need explain what items what they are including in their current estimates.

TKMS hasn't even received tender documents - so TKMS is in no position to place a price estimate on what Australia may want. For example Australia may want VLS and new advanced Lithium-ion batteries s but no AIP.

Hi Pete,I believe these rough estimations are quite well to figure out in what kind of ballpark you are playing.

The calculations made by ASPI are interesting to play with. Take the $16.8 billion as price for a current fleet of 12 Collins-class submarines. Divide the price by 12 and 1.5 to get the weight right and you see what an Australian designed Type 214 would cost: $930 million.

The price difference is a result of experience and mass production.

Australia should remember the biggest ship produced by Kockums was the Collins-class. Now SAAB-Kockums tries an even heavier one. The last submarine built in Sweden was the Gotland-class in 1996. What kind of experience Kockums can really offer to design an 4.000 t submarine?

Btw., does Australia starts to think about an F-35 replacement: the SAAB Gripen?http://www.news.com.au/national/raaf-overlooks-saab-gripen-for-more-expensive-controversial-joint-srike-fighter/story-fncynjr2-1226878507849#comments

Thanks for the estimates. Given that TKMS was talking about a limited set of new submarine costs and TKMS don't know what Australia wants in the new submarines yet - only approximations are possible.

Also estimates might be in current dollars not the dollars used in tender responses which may be in 2018 or later.

Thanks for the news article about the Gripen. I (and no doubt Australia's DoD) supported purchase of the Super Hornet 7 years ago when Gripen versus Super Hornet and other fighters was being considered. Minister DoD, Brendan Nelson, made the right decision in choosing Super Hornet. A major reason was that Australia was very happy with 1980s Hornet purchase and Super Hornet also met Australia's needs.

Once the the F-35 is retired in the 2070s I have no doubt Australia will re-consider the Gripen :)

Submarine Matters

Director, Submarine Matters International. I analyse international trends, technical and political - mainly on submarines, sometimes on surface ships, aircraft and missiles. This website started in 2007. I have a Masters Degree (International Relations) High Distinction average. The best way to navigate this site is to put a keyword in the search box top left corner.